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Why America Stopped Driving

In 1922, a group of sociologists went to Munice, Indiana, to study how the average American family lived. Almost everyone, they found, was addicted to their car. "We'd rather do without clothes than give up the car," said one mother of nine children. "I'll go without food before I'll see us give up the car," said another. One researcher reminded a housewife that her family had a car but no bathtub. "Why," said she, "you can't go to town in a bathtub!" The automobile was barely two decades old, and Americans already couldn't imagine living without one.

But a change is taking place that is unprecedented since those sociologists' study nearly a century ago: Americans are driving less.

Miles driven per American peaked in 2005, and have since declined 8.8%. This has never happened before. From 1900 to 2007, vehicle miles driven increased every year except 1932, during the Great Depression, according to data from the Department of Transportation. It's now declined in three of the past five years. From 1971 to 2005, miles driven per person increased every year expect 1975. That figure has now declined in each of the last eight years.

You get some staggering numbers when you add this stuff up. If driving habits merely maintained 2005 levels, Americans would have driven 918 billion more miles than they actually did over the last eight years. That's like driving to Mars and back 13,000 times.

Not only is this decline unprecedented, but it was totally unforeseen. In one amusing display of how off the nation's best traffic forecasters (it's an actual job) have been, Eric Sundquist of the State Smart Transportation Initiative showed the Department of Transpiration's recent forecasts of miles driven compared to what actually occurred:

What's going on?

The most shocking thing about this driving decline is that it doesn't seem to be caused by the weak economy.

U.S. PIRG Education Fund crunched the numbers last and year, looking at how Americans driving habits changed broken out by state. It found plenty of states where driving plunged, yet economies and job markets were healthier than the national average, and states whose economies were ravaged by the recession, but where miles driven actually went up. The researchers looked at it every way they could -- the unemployment rate, changes in employment, etc. There was very little link between the economy and the decline in driving. Of the 10 states where employment fell the fastest during the recession, only two were among the top 10 states with the largest decline in driving. On average, the group found "that declining rates of driving do not correspond with how badly states suffered economically in recent years."

Some say higher gas prices have caused drivers to stay home. It's a nice story, but there's not much evidence backing it up. Gas prices are lower today than they were six and a half years ago. And average fuel efficiency has surged over the last decade, putting the real cost of gasoline usage today no higher than it was a decade ago.

The most compelling argument for why driving is in decline is also one of the scariest, because it might not be temporary. It's demographics.

The most important group of drivers are those age 35 to 54. They're in their prime working years, driving an average of 15,291 miles per year, according to the Department of Transportation. But driving falls off quickly as people move into retirement. Americans age 55 to 64 drive fewer than 12,000 miles per year, on average. And Americans age 65 and older drive an average of only 7,650 miles per year -- half what they drove in their prime working years.

That's a critical difference, because after rising for decades, the number of prime-driving age Americans plunged by 2.8 million over the last eight years as baby boomers age into their 60s. The number of prime-age drivers peaked at the exact time miles driven per capita peaked:

Source: Census Bureau, author's calculations.

For decades, economists have wondered what will happen to the economy when the baby boomers retire.

Will they spend less money? Will that hurt the economy?

The driving slowdown might be one of our first clear answers.

Things are always more complicated than they seem, and demographics can't explain all of the decline. But it's a big cause, and it'd had a big impact on the economy. Remember, Americans drove 918 billion fewer miles over the last eight years than they would have if 2006 driving trends hadn't changed. If a car has a lifespan of 200,000 miles, that ultimately means demand for vehicles over the last eight years was about half a million cars per year lower than it would have been at old driving rates.

But America is getting older. That's going to make growing the economy over the next 50 years harder than it was over the last 50. "The trick is growing up without growing old," baseball great Casey Stengel once quipped. We'll see if America can.

Check back every Tuesday and Friday for Morgan Housel's columns on finance and economics.

Comments from our Foolish Readers

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I wonder if there's a correlation with urbanized areas and driving. I don't drive very much anymore because I live downtown. I drove a lot when I lived in the suburbs. intuitively it would make sense for higher population density to result less need for driving.

Cars have become too good and prosaic. The ride in a modern car is well insulated, quiet, comfortable and reliable. They lack manual transmissions, manual windows, a jouncy ride and have electric assisted steering, adaptive cruise control and lane departure assistance.

In short, they lack a substantial amount of the visceral appeal of older vehicles. Even among my fellow automobile enthusiasts, it's noted that it's often more entertaining running around in an old beater than a newer car.

I suspect part of the earlier attraction to cars by teenagers was due to the visceral exhilaration and to a degree danger offered by earlier incarnations of the vehicle.

Again I have no evidence to support this, but I imagine it plays a role, even if I small one.

When I was younger I did a lot of driving in a car like you describe, not because I enjoyed a clapped out car but because that was all I could afford. I would have much rather had a brand new top of the line model. I still enjoy driving and now I have a car with most of the modern conveniences (cruise, auto, A/C, all power). It makes driving much more enjoyable and less tiring. However, being retired, I have many less places to drive to, so I drive less. I prefer driving to flying or taking a bus. Unfortunately, I have a wife who gets fidgety after two hours on the road and wants to stop after four.

My kids (now 23 and 26) just didn't care about getting a driver's license at 16 when they would have been able to. They eventually did but still are less enthusiastic about the situation than I was as a young man (and all my peers).

Cars were the high tech stuff back when I was young (60's & 70's) and they're just clunky old mechanical contraptions now. Digital and Software and biotech are the new cool... Wow, nice phone!

Also I was one of five kids. My two kids were one more than a lot of families and that trend is getting more and more distinct.

Yet again I find myself marveling at Morgan's admirable restraint---because once again we're graced with the opinion of one particular commenter who doesn't read (or reads without comprehension) the article on which s/he is opining; in this case, the commenter insists that declining driving MUST be related to unemployment despite the fact that the article clearly states that the researchers could find no such link!

Changes in age demographics are undoubtedly a major factor, but housing demographics may also play a roll. People move far from work to save on housing costs which increases driving. This trend can not go up forever, and at least locally has leveled off or even changed to more people buying/renting closer to work.

Morgan: I suspect a missing element is Airfares and Airline travel. It would be interesting to overlay passenger miles by air with your graphs. Many people today simply do not realize the sea change that took place in the 70's and accelerated in the 80s because they were so immersed in it.

I recall vividly the first airline trip anyone in my family took in 1962, my Mom flew back to the midwest for her Mom's funeral. It was a luxury and priced like it. Long trips, lots of miles were by car or train. This habit continued through the early 80's and then something changed: ticket prices and competition

People got used to it, and then something else changed, gas prices. And remarkably, some trips got lots cheaper by air than by driving. I frequently find myself debating mode of travel to Seattle from Portland, because on many occasions its cheaper to buy a seat than to fill a gas tank. NEVER would have happened in 1982.

Does the cost of car ownership today have anything to do with it? When my son was 18 , I went to my insurance agent to see what insurance would cost him, it was $2400 a year, when he heard this, he decided he could bicycle most places he needed to go for free. Gas is only a small part of the cost. While the cost of cars and gas are higher today in relation to young people have spend. The mean income of many American parents who have to financial jump start the young has not. The amount of non-essential driving in the US is a function of the disposal income of young drivers.

Raising the minimum wage would increase the number of miles we drive and the economic multiplier that results.

I think invention of Smart phones, Tablets, Facebook, Netflix, Amazon are responsible for less driving. Why drive to Cinema hall, shopping mall when you can order them online! Meetings, conferences even schooling is in ones hand. People have no time or urge to take a long drive for sight seeing, Camping or other excitements.

I agree with kyleleeh, though urbanization is likely a secondary contributor instead of a primary contributor to less driving.

Urban living is hip again. I use to live in downtown SF, and rarely needed my car; most of the things I needed weekly were within walking distance.

When I moved to the 'burbs a couple years ago, places without access to transit with easy access to SF -- like Los Gatos, which is a beautiful town but requires driving to pretty much everything -- were not considered. We ended up choosing a home near CalTrain, and thoroughly enjoy being able to use it for dining, going to shark and giants games, and treks up to The City.

from the PIRG report of the 10 areas with the largest per capita commuting mileage declines, crossed against two lists of "Americas best cities for mass transit.

5 of PIRG's ten were on both best cities for mass transit lists

7 of 10 made both lists if Mission Viejo from PIRG is Los angeles from the other lists.

Austin only made one list. Poughkeepsie only made one list.

Colo. Springs did not make either list, neither did Charlotte NC/SC

The same can not be said for PIRG's list of ten largest declines in VMT's (all VMT's not just commuter). Only three metro areas on PIRG's top ten fewer VMT's list made either list of good mass transit systems (poughkeepsie, Milwaukee, and Denver/Aurora.

Only Poughkeepsie made both PIRG lists of fewest commuter VMT's and fewest VMT's.

All but four of the cities on the top ten fewer Vmt's list have unemployment over 7% and into the 9% except Pensacola at 6.2%, Jacksonville, Tulsa, and Madison Wi which all have unemployment under 5%.

Both Tulsa and Jacksonville can be crossed to lists of popular retirement cities, so even with low unemployment retired people can choose not to drive for economic reasons and possibly impact VMT's

So while there may not be an obvious connection between economics and miles driven, it may just be hidden by a lack of investigation into the specifics of the metro areas looked at and differences within the metro areas studied.

Retirement is likely one driving force, exceptionally high unemployment and low wage jobs among graduates entering the workforce may be making not owning a car less of a choice and more forced in that group, and alternatives to driving in cities that were less impacted by high unemployment may be allowing a choice pushed by economic forces that smudges the overall results.

Mass transit and urban living have likely played a roll. But did either of those things suddenly explode in 2006? I haven't seen any evidence of that -- the populations of suburbs stopped growing considerably after the housing boom ended, but I haven't seen evidence of sharp enough decline to account for almost a trillion miles of driving. And we've had subways and buses for a long time.

The one factor that did suddenly take a sharp turn in 2006 (when millage peaked) is the number of prime-age driving Americans.

I have noted with my own parents that they get harder and harder to buy for as they already have everything they need or want, it comes down to subscriptions for cable tv and vouchers for beauty treatments and the like.

"The most compelling argument for why driving is in decline is also one of the scariest, because it might not be temporary. It's demographics."

What is scary about it? I'm no car aficionado (they're dangerous to people and the environment), but even if you like cars it's not too scary to find that other people don't. The big concern would be economic impact, but as you said:

"There was very little link between the economy and the decline in driving. "

Can anyone really predict what will be cool/hip/popular in the future? Malcolm Gladwell's book Tipping Point discusses this in some detail, and the things that cause major changes in behavior are subtle and complex (why did Uggs become popular, why did crime in NYC drop in the 80s->90s, etc).

I agree with you overall, I just believe prime-age driving is responsible by plurality, not majority.

Still, it's pretty neat to see the reduction in driving; I didn't know it was occurring to such an extent, and I appreciate all your articles. Countries that are dependent on America's excessive oil dependency should be quaking in their boots, and I can think of few things that would benefit this country more than to reduce our usage of oil and make the US energy self-sufficient.

(I'm no liberal, I just think energy self-reliance makes a lot of sense).

I addition to the above comments, I would add traffic congestion and crumbling infrastructure to the list of why we are driving less. Who wants to sit in traffic jams all day if there are alternatives to getting stuff or meeting people.

I'd posit that an increase in stay-at-home workers is also a contributor. I've no hard data to back that up, though. All I can say is that 16 years ago, when I first started working from home, I was considered an anomaly among my peers. No longer.

Hate to be a little raincloud here, but where exactly is MUNICE, Indiana? Is it anywhere near Muncie? I was surprised to see expect in place of "except" (I can only presume) and about then I quite reading. Before you post this article again, please spell check it and ask somebody, NOT a computer to do the same? Foolish has a whole new meaning with that many type-o's that early on.